Clearing the Low Bar
Are the people on Team Trump liars or lunatics?
When a supposedly smart and highly successful man’s claims go far beyond the lunatic fringe, it’s hard to believe he is not just lying through his teeth … and even doing a terrible job of lying. In spite of all the inflation news this week coming in hot and ugly, US Secretary of the Treasury Scott Bessent said today that we are just about to enter a period of significant DISinflation; so, there is nothing to worry about. Trump’s new choice for Fed head, he said, will have plenty of elbow room for some savory rate cuts to keep priming the stock market up, too.
Bessent said he thinks there will be one or two more “hot inflation numbers, but then I think we’re going to see substantial disinflation.”
Even with recent inflation news universally bad, Treasury Secretary Scott Bessent expects price pressures to ease soon, just in time for the new Federal Reserve chair to take over.
Speaking Thursday to CNBC, Bessent said the energy-fed inflation surge recently is likely to reverse as the U.S. is “going to keep pumping” oil, easing the supply shock from the Iran war.
“I firmly believe that nothing is more transient than a supply shock, and we can look through that because, before the Iranian conflict began, core inflation was coming down,” Bessent told CNBC’s Joe Kernen from the sidelines of President Donald Trump’s summit with his Chinese counterpart, Xi Jinping. “So I think core inflation will continue coming down.”
That hasn’t been the recent trend, however.
Now you have a tough question to face. Who are you going to trust? A little po-dunk sideshow like me or a very wealthy financial man who has earned and bought his way into the highest finance position in the United States who has many financial pedigrees to his education and experience? All the usual things that people go by say you should trust Bessent.
The problem is Bessent, who even spoke with a big smarmy smile, was pitching this same story throughout the Year of Chaos in which tariffs kept getting paid only by American businesses and started passing through to consumers this year, as he repeatedly said would not happen. He also told you at the start to the war that inflation from the war would not be significant and would be short-lived. Worst of all, he just now said this inflation will be transient after you already lived through a period of painful inflation that the Fed never succeeded in completely killing, which happened because the Fed kept using the same argument—that the inflation was “transitory” because it was coming from transitory causes—supply chain disruptions. As soon as those went away, inflation would start to abate, they claimed, just as Bessent does now. It didn’t, and they struggled for two years to beat the hydra’s ugly heads back down … and failed!
So, are you going to believe the smartly dressed political appointee whose personal fortune landed him this plum position or believe the little guy who has been warning you all along some major inflation is coming quickly? Bessent now says, in essence, “OK, it did arrive, but it is going to be very short-lived because the war will soon be over, and the United States will pump the whole world back up to adequate oil supply within a mere two months so that, instead of seeing MORE inflation, you will see prices actually deflating two months from now.”
I don’t know how people like this can keep from choking on their own fat tongue, yet Bessent says it with a smarmy smile!
Consumer prices jumped 0.6% in just one month, and producer prices jumped by more than double that much.
Just look at his twisted logic:
Bessent said he remains optimistic that this period is different than the last inflation surge in 2021-22. The prior move followed the Covid pandemic, which sparked unprecedented fiscal and monetary stimulus as well as a massive supply and demand imbalance. At the same time, the Russian invasion of Ukraine hit energy markets, causing oil prices to spike.
So, how is a massive supply and demand imbalance accompanied by large oil price spikes that are happening due to war different this time from last time?
It sounds like Bessent is describing the exact same scenario to me! We have a huge global supply imbalance in energy that everyone, except those in the Trump administration, agrees is the worst oil supply shock in history. That will soon translate into supply imbalances in everything that uses oil or Nat Gas as an ingredient, such as plastics and lubricants and fertilizers and numerous chemicals that go into everything else. We’ll also have supply imbalances in the many products that ship using oil as a fuel because they won’t ship. Airlines are already substantially cutting down flights due to fuel prices and shortages, which includes freight. Many other forms of transportation—ships, trains, trucks—will pare down routes, too, for the same reason.
How can someone seemingly so smart be so dumb? Oh, yeah, there is the other option: he’s lying. Still, how can he be so dumb as to think anyone will believe a lie that is that shoddy? Oh, yeah, stocks will believe him. They believe anything now that feeds investor greed a ray of hope. They even believe Bessent’s boss, who spits out lies like machine-gun fire, practically destroying every promise he ever made, even to his own supporters, the majority of whom still believe him! They probably still believe he’s not in the Epstein files more than about five times and that none of the times implicate him in anything.
Whew! It seems like a long time since we’ve heard anything more about that. The distractions really are working!
We live in a world fully addicted to lies because the vast majority of people know what they want to believe and are willing to keep believing all the lies it takes to support their view. I’ve never seen any administration lie as much as this one, get proven wrong as many times, and yet go right on doing it. They even lie more than any Democrat administration I’ve seen, and that’s a pretty low bar to try to crawl under.
In my weekend Deeper Dive, I will demonstrate that Bessent is dumber than a rotten turnip by showing in detail why this inflation is far from transitory, just like I did with the last inflation—why it will go hotter for longer.
